Abu Dhabi store fined Dh100,000 for credit card fee charge

The Ministry of Economy carried out its threat and fined a mobile phone shop in Abu Dhabi Dh100,000 for charging an extra fee on a credit card used by its holder in a purchase deal, business sources said on Tuesday.

The shop on Defence Road, home to more than 100 mobile phone stores, imposed a 2.25 per cent fee on the customer without his knowledge after he bought a mobile handset for around Dh1,200, they said.

When the customer checked his bank account, he found that a sum of Dh1,227 had been taken off although his purchase bill showed he paid Dh1,200.

The bank told the customer that he had been charged Dh27 by the mobile phone shop and advised him to lodge a complaint to the Ministry of Economy.

The sources said the bank assured the customer that it does not charge credit card holders and told him to either complain or return the handset to the shop.

“The customer went straight to the Ministry of Economy on Monday morning and filed a complaint….three hours later, two inspectors came to the shop and handed it a notice asking it to pay Dh100,000 fine,” one source said.

“The man in charge of the shop said he would appeal the decision after he was told by the inspectors that he could do so.”

The sources did not reveal the name of that shop but most mobile phone businesses on Defence Road charge 2.25 per cent on credit card deals.

“We have to take that fee otherwise we cannot make a profit on any deal paid by credit card…we do not take that fee as it goes to the credit card network as we have been told by the banks,” a mobile phone shop owner said.

“After what happened to that shop on Monday, we are not considering stopping credit card transactions and accepting only cash…another option is that we either tell customers about the fee or we just slightly raise the price of the handset to offset the fee taken off by the credit card network.”

The Ministry of Economy warned all shops in the UAE last year against levying any additional charges on credit card transactions and said offenders could be fined up to Dh100,000. The warning came after the Ministry was flooded by complaints from visa card holders about the surcharge.

A senior Ministry official said the decision is in line with the new amendments to the Consumer Protection Act approved by the federal cabinet.